Kuflink CEO: Firm in good health after auditor withdrawal

The peer-to-peer lender has appointed a new auditor, MHA MacIntyre Hudson, and has been working to address the issues raised following the exit of EY.

Kuflink CEO: Firm in good health after auditor withdrawal

Kuflink CEO Narinder Khattoare has said that the firm remains in "good health" after its auditor exited the firm after raising concerns about governance.

Auditor EY quit Kuflink in February according to a letter sent to Companies House. That letter said that the lender needed to improve its governance and record-keeping but there is no suggestion of any wrongdoings by the firm.

In response, the peer-to-peer lender has appointed a new auditor in MHA MacIntyre Hudson and has been working to address the issues raised.

Khattoare said: "I would like to confirm that the business has already successfully worked through many of these areas recorded by our old auditors with some still being addressed in collaboration with our new auditors.

"I would also like to note that none of the issues have or would have compromised any investor funds.

"We had already started working in September 2020 with our new auditors on the matters highlighted (before Ernst & Young formally withdrew) and this was communicated to the FCA online."

Khattoare added that the firm had seen losses narrow and that no investors had lost money with Kuflink.

He added: "In 2021, the business is in a strong position and comes out of the pandemic in very good shape. Losses have narrowed to a point where we are confident that we are likely to announce breakeven or a profit very soon.

"As far as investors are concerned, £121m has been invested in the time we have been operating and I would point out that not one investor has lost money with us.

"£25m was paid back to investors during the pandemic but in total, we have returned over £73m in capital and interest to investors, many of whom have demonstrated their continuing confidence in Kuflink by reinvesting."

EY had also raised concerns over VAT liabilities during its resignation.

Khattoare said: "In respect of VAT, we have been in contact with HMRC since September last year, as the pandemic created delays in earlier contact.

"The VAT amount has already been set aside and we are working with our new auditors to settle by the June 2021 deadline required by HMRC.

"Kuflink is in good health and looking forward to strong inward investment during the rest of this year and beyond."

Kuflink launched its peer-to-peer platform in 2016.